For
decades administrative agencies have jealously guarded their near authoritarian
power by forcing those accused of violating agency rules to proceed
through layer upon layer of agency review before a “final agency
order” is declared and available for appeal. Often, once the agency
deems a regulated company or individual in violation of its rules, it
imposes fines and interest upon the fines each day the accused fails
to pay. In this way, the party accused is placed in a dire predicament.
The accused must either pay or must risk losing in a system that is
biased against the accused, often placing at risk hundreds of thousands,
if not millions of dollars. As you might well imagine, most companies
and individuals never make it through the agency gauntlet, accepting
the agency’s punishment or settling with the agency, regardless
of how unjust and burdensome the terms, to avoid greater fines, interest,
and penalties.

Federal agencies
possess legislative and executive or legislative, executive, and judicial
powers that they wield with virtually no checks. They rule as if they
were absolute monarchs, making the laws that govern those they regulate,
accusing those they regulate of violating the laws, and judging the
law violations. There is in this no true separation of functions. The
judge who made the law is also the prosecutor, depriving all of any
real hope of impartial justice. Those who head the agencies are often
corrupt and use their power to enhance their own prospects for post-government
employment, picking winners and losers based on the effect those choices
will have on the agency head’s financial and political future.

That near absolute
power combined with byzantine, multi-layered systems of agency review
deprive those accused of violating agency regulations of a full and
fair hearing on the merits and of a true presumption of innocence until
guilt is proven in almost every case. Even after administrative remedies
are said to be exhausted and the case proceeds to federal court, in
the vast majority of cases the court defers to the agency’s judgment
and confirms the agency’s determination, leaving the petitioner
subject to fines and legal fees that are often far beyond affordable.

The overall impact
of granting federal agencies so much power over the fate of their regulated
subjects is to humble the regulated into total submissiveness and subservience
and to embolden the regulator into omnipotence. The typical course for
regulated parties is to avoid serious challenges to agency authority
and jurisdiction, inviting ever greater assumptions of power by the
agencies beyond their statutory mandates. Endless growth in government
size, scope, and power is the result (in flagrant violation of constitutional
and statutory limits).

In Sackett v. EPA,
the Supreme Court defeated the EPA’s denial of judicial review,
establishing a basis to improve access to federal court. The decision
is an important precedent for all beleaguered by the multiple layers
of agency review. It is not an ultimate resolution of the problem, but
does provide a new weapon in the arsenal of those who try to break free
from costly, biased, and seemingly interminable agency proceedings in
an effort to secure independent judicial review.

Michael and Chantell
Sackett own a 2/3-acre residential lot in Bonner County, Idaho. Their
property is separated from Priest Lake by several lots that contain
permanent structures. The Sacketts elected to build a home on the lot.
To support construction of the foundation for that house, in April and
May 2007 contractors filled part of the lot with dirt and rock. Unbeknownst
to the Sacketts, the EPA had deemed the Sacketts’ lot a “jurisdictional
wetland” because it was “adjacent” to Priest Lake,
which is a “navigable water” under 33 U.S.C. Section 1362(7).
By filling the land in preparation for construction, the Sacketts had,
according to the EPA, “discharged” “pollutants”
into “waters of the United States.” EPA deemed the act a
violation of 33 U.S.C. Section 1311. The EPA sent the Sacketts a document
that has very draconian consequences. It is called a Compliance Order.
The order directed the Sacketts “immediately [to] undertake activities
to restore the Site in accordance with [an EPA-created] Restoration
Work Plan” and to make the site available for inspection by the
EPA. Every day the Sacketts fail to comply causes huge fines to be accrued.

The Sacketts disagree
with the EPA’s reading of the law and do not believe their property
is appropriately considered a wetland, is sufficiently near Priest Lake
to be deemed adjacent to it, or causes the discharge of pollutants into
the navigable waters of the United States. EPA’s Compliance Order,
however, placed them in an untenable position. The order is designed
to make contest so burdensome that people will forfeit their rights
rather than challenge an apparently omnipotent EPA. There is no escape
from the Order as the EPA construes it. Every day that the Sacketts
remain out of compliance (fail to fulfill all of the EPA’s demands
in the Compliance Order), they are subject to $37,500 in civil fines
and an additional $37,500 in penalties. Needless to say, few are as
courageous as the Sacketts who, if they lose this fight, stand to be
forced to pay $75,000 for each day of their non-compliance (or contest)
of the EPA’s Compliance Order. In addition, the Army Corps of
Engineers, who must grant a permit for land fill, will not issue one
to the Sacketts in the presence of an EPA Compliance Order. The findings
of fact in the Compliance Order are not subject to any further EPA review.
Judicial review of the EPA Compliance Order is not permitted under the
Clean Water Act. Rather, only the EPA can initiate judicial review under
33 U.S.C. Section 1319. Consequently, the Sacketts only recourse was
to negotiate with the EPA, albeit the EPA has been entirely unwilling
to drop any substantive requirement in its Compliance Order.

Advertisement

In short, the Sacketts
were forced to accept the EPA Compliance Order or be fined and penalized
into oblivion. There would be no resort to federal court for an impartial
determination of the merits of EPA’s position. Like in so many
other cases, the EPA deprived the Sacketts of an opportunity to receive
independent redress for their grievances. They would be crushed under
the powerful weight of an agency that possessed the hallmark characteristics
of tyranny—unbridled discretion and absolute power (the law maker
is the law enforcer and is the judge).

Bravely, the Sacketts
sued the EPA in federal court, arguing that under Chapter 7 of the Administrative
Procedure Act (APA), they were entitled to judicial review of what was
a “final agency action for which there is no other adequate remedy
in a court,” 5 U.S.C. Section 704. On the merits, the Sacketts
argued that the EPA Compliance Order violated the APA because it was
“arbitrary, capricious, and contrary to law” and that it
deprived them of their property without due process of law in violation
of the Fifth Amendment. The United States District Court for the District
of Idaho dismissed the claims, concluding that under the Clean Water
Act the court lacked subject matter jurisdiction (meaning that the challenge
was not one for which the Sacketts had a right to appeal to the court
from the agency). The United States Court of Appeals for the Ninth Circuit
affirmed the district court’s judgment.

The decisions of
those two courts are in line with dozens of others that likewise have
dismissed appeals from administrative agency actions that the agencies
declared not to be final (despite the very real effect the actions have
had on determining the rights and obligations of parties). This time,
however, the Supreme Court in a unanimous decision reversed the lower
courts.

The Supreme Court
concluded that the absence in the Clean Water Act of a provision expressly
denying a right to judicial review arising from EPA issuance of a Compliance
Order caused the APA presumption in favor of judicial review to be controlling.
In his opinion for a unanimous court, Justice Scalia reasoned, “[t]he
government warns that the EPA is less likely to use the orders if they
are subject to judicial review. That may be true—but it will be
true for all agency actions subjected to judicial review. The APA’s
presumption of judicial review is a repudiation of the principle that
efficiency of regulation conquers all. And there is no reason to think
that the Clean Water Act was uniquely designed to enable the strong-arming
of regulated parties into ‘voluntary compliance’ without
the opportunity for judicial review—even judicial review of the
question whether the regulated party is within the EPA’s jurisdiction.”
The Court concluded that the EPA Compliance Order was a final agency
action for which there was no adequate remedy at law other than the
APA, and that the Clean Water Act (silent as to whether an EPA Compliance
Order was appealable to federal court) did not preclude judicial review.

There are many
instances in which actions by the Bureau of Land Management over western
range lands; actions by the Food and Drug Administration against the
makers of foods, dietary supplements, and drugs; actions by the Drug
Enforcement Administration against physicians and other distributors
of controlled and scheduled listed substances; actions by Medicare against
providers, including physicians; and actions by the Environmental Protection
Agency, among others, determine the rights and obligations of parties
through actions that are not, according to those agencies, final and
appealable. Thanks to Sackett v. EPA, those actions, if they do not
afford an opportunity for judicial review, may now be brought to federal
court nonetheless.

Sackett is not
an ultimate resolution of the underlying problem Congress has created,
but it is a move in the right direction. Because agencies of the federal
government in fact operate without any true separation of functions
(enabling the law-maker to be the law-enforcer and ultimate judge),
the administrative courts are more often than not kangaroo courts, rubber
stamps for the position adopted by the agency’s leaders. Justice
depends on impartiality. Bias reigns in the administrative courts and,
even when on occasion a brave ALJ bolts from the agency line, the agency
leaders ordinarily pass final judgment and are quick to reverse any
decision not in lock step with the leaders’ preferences.

Subscribe
to the NewsWithViews Daily News Alerts!

Enter
Your E-Mail Address:

Congress should
abolish the administrative courts, prohibit deference to agency findings
of fact and conclusions of law, and expand judicial review to compel
agencies to file suit in federal court against those they accuse of
rule violations, enabling the accused to receive immediate review in
a trial de novo on the merits in every case, without any deference to
the agency’s findings and conclusions. Moreover, Congress should
prohibit imposition of penalties and interest for non-compliance unless
there has been a final and binding decision by the federal courts against
the accused. Penalties and interest should only accrue for failure to
pay after the time specified for payment under that final and binding
decision. Allowing the accumulation of penalties and interest without
a final and binding judicial decision deters the exercise of the right
to sue the government in defense of one’s life, liberty, and property
and is an assault on the presumption of innocence. Until we treat federal
agencies as equal before the law with those they accuse, we will never
see justice meted out with impartiality. The indispensable element underlying
our Declaration of Independence and our Constitution is individual sovereignty.
Government was to be our servant, not our master. Equal justice under
law is meaningless unless agency accusers stand before the bar of justice
on an equal footing with those they accuse.

Jonathan W. Emord
is an attorney who practices constitutional and administrative law before
the federal courts and agencies. Congressman Ron Paul calls Jonathan “a
hero of the health freedom revolution” and says “all freedom-loving
Americans are in [his] debt . . . for his courtroom [victories] on behalf
of health freedom.” He has defeated the FDA in federal court a remarkable
eight times, six on First Amendment grounds, and is the author
of Amazon bestsellers The
Rise of Tyranny, Global
Censorship of Health Information,
and Restore
the Republic. He is also the American Justice columnist for
U.S.A. Today Magazine. For more info visit Emord.com.

In
short, the Sacketts were forced to accept the EPA Compliance Order or
be fined and penalized into oblivion. There would be no resort to federal
court for an impartial determination of the merits of EPA’s position.